FAQ-s on Health Care Reform

Of course there are more questions than ever when it comes to health care reform. We have compiled the most frequently asked questions and simple answers for your convenience.  For more detailed answers, please call your Total Benefit Solutions Advisor at (215)355-2121

Will I have to have health insurance? 

Simply the answer for most people is yes. There are some exceptions. Individuals who have a religious exemption, those not lawfully present in the United States, and incarcerated individuals are exempt from the minimum essential coverage requirement.

Will I have to pay a penalty for not having insurance coverage?

Again, simply the answer is probably.  The Supreme Court calls it a tax, but for the sake of simplifying we are calling it a penalty.

The penalty is the greater of:

  • For 2014, $95 per uninsured person or 1 percent of household income over the filing threshold,
  • For 2015, $325 per uninsured person or 2 percent of household income over the filing threshold, and
  • For 2016 and beyond, $695 per uninsured person or 2.5 percent of household income over the filing threshold.

There is a family cap on the flat dollar amount (but not the percentage of income test) of 300 percent, and the overall penalty is capped at the national average premium of a bronze level plan purchases through an exchange.  For individuals under 18 years old, the applicable per person penalty is one-half of the amounts listed above.

Beginning in 2017, the penalties will be increased by the cost-of-living adjustment.

Is it true that I may have to pay the penalty even if I have health insurance coverage?

The answer is yes. You must not only have coverage, it must meet the minimum level of essential coverage, or EHB in order to avoid paying the penalty. So, yes you might have coverage and still pay the penalty.

Are there other exceptions to when the penalty may apply?

Yes.  A penalty will not be assessed on individuals who:

  1. cannot afford coverage based on formulas contained in the law,
  2. have income below the federal income tax filing threshold,
  3. are members of Indian tribes,
  4. were uninsured for short coverage gaps of less than three months;
  5. have received a hardship waiver from the Secretary, or are residing outside of the United States, or are bona fide residents of any possession of the United States.

Will my employer still offer health insurance as an employee benefit?

The answer here is…depends. Some employers will continue to offer coverage, while others may decide to move to a simpler, defined contribution plan.

I am a small employer. How will I know if I would be better served providing coverage or just providing a defined contribution?

Our firm has developed the tools to answer these questions for you. Please ask us today how we can provide these for you!

 

As usual, there are many more questions and answers. We also offer the HR360 service for our clients who require more detailed information. Ask us today if you need further assistance.

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